Shuman Roy is an entrepreneur, business owner, and musician. He started RoysNoys, LLC in 2013 as a music production and education service company. He also offers small business consulting and advisory services to help businesses get from start-up mode to turn-key operations. Shuman earned his M.B.A from the Stern School of Business in 2001 and has an undergraduate degree from Manhattan College in ...

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Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Joel...

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Reviewed by Joel Ohman
Founder, CFP®

UPDATED: Sep 23, 2021

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Homeownership comes with unique challenges for each family. When you apply for a mortgage, your lender will check your income and debt ratios. Many things can change in an instant from your debts and family situation to losing your job or taking a lower paying job. When these types of things happen, you may be able to refinance your mortgage for a lower monthly payment. You won’t always qualify for a refinance, though. More importantly, it costs money to refinance.

Whether you’re refinancing or looking for other ways to save on your home costs, you can look at insurance. As long as your policy meets lender standards, you can choose the company and shop for a lower premium. This could mean lowering payments on not just car insurance premiums, but homeowners insurance as well. If you’re not planning on refinancing or paying down a significant portion of your mortgage, changing your homeowners insurance premium could be the only way to lower your monthly payments.

So let’s take a look at some available discounts a homeowner’s insurance consumer may want to take advantage of to get those pesky insurance premiums down, as pointed out by a recent release from Southwestern Insurance Information Service (SIIS):

Home Security Systems, Dead Bolt Locks, Smoke Alarms, and Gated Community Discounts

The benefits of an alarm or other security system in a home are clear. Insurance policies have a range of discounts specifically connected to security features. Just make sure to ask your agent or insurer if they have duly noted your participation in any of the above home security features and credited any of the discounts to your premium. You don’t necessarily need full 24 hour monitoring to qualify for discounts.

Non-Smoking Households

Yes, there are insurance companies that offer (sometimes large) discounts to clients who do not have any smokers living in their home. All the stories you hear about people falling asleep with cigarettes and burning down the house are true. Unfortunately, these claims can be costly financially and otherwise, and it’s much harder for a homeowners policy to exclude coverage for smokers. So they may offer discounts for not smoking at all.

Note: You will not qualify for the discount by pointing out that you “don’t smoke inside.”

Senior Discounts

Seniors tend to have more equity in their homes and actually reside at home more often. Both facts statistically demonstrate a lower propensity for insurance claims by frequency and severity.

Multi-Line or Home and Auto Policies from the Same Insurer

Read more about why packaging your home and auto insurance is a benefit to both you and your insurer, and how it can cut down related costs. You can quote home, auto, and other policies with popular insurers like Progressive, GEICO, and State Farm. You can also quote one or the other in addition to an existing policy if you want to stay with a certain insurer.

Higher Deductible

Shocker alert! Higher insurance deductibles equal lower overall premiums. Basically, you are agreeing to self-insure more of your property losses. Less potential payout for the insurer equals more money in your pocket. Just make sure you can afford to pay your deductible in the event of a claim. A high deductible could delay your repairs if you cannot afford to pay it. Especially with something like water damage, you want to get it fixed as quickly as possible to avoid mold, rot, and other signs of neglect that may not be covered in the future.

Also read: What happens to an insurance premium when a deductible is lowered?

Loyalty Discounts

These discounts are a good idea if the insurer is taking advantage of your loyalty. Many captive insurers, who only sell one insurance product (State Farm and Farmers, for example) might be more than happy to reduce your premium by one or two percent while perhaps charging you more than other companies in general.

Be certain to at least consult a local independent agent to shop your premium and make sure you are not being overcharged. Any time you stay with an insurance company for a long time, they save money on advertising to bring in more new customers. So assuming you also don’t file claims, you’ll get bigger homeowners insurance discounts each year.

Electronic Payment or Advanced Payment

Both options allow the insurer to sleep more soundly at night because they’re sure they have your money. Expect at least 5-10 percent premium reduction for paying your premium in full and expect to save between $3 and $10 per month by making electronic payments via credit card or a checking account.

Positive Credit Rating

Credit strikes again. Good credit typically equals a lower insurance premium and vice versa. There are still several companies out there that don’t look at your credit in order to determine how much to charge you. Make sure to visit an independent agent to find one of these insurers if you have less than perfect credit.

Organization Affiliation

Do you belong to a credit union, work union or are you an employee of a large corporation? If yes, be sure to ask if you qualify for discounted insurance through your company. But still be sure to shop around, as insurance professionals have seen instances where people save big bucks as a result of an organizational affiliation and instances where people have overpaid substantially.

How Else Can You Save?

– Don’t pay for coverage you don’t need (review your coverage)

– Keep your risk as low as possible (swimming pools, trampolines, and dogs increase cost/risk of claim)

– Consider putting expensive items like jewelry in safe deposit boxes instead of your home

– File insurance claims only when necessary

As discussed above, it is highly recommended that you visit an independent insurance agent or broker to determine if you have the coverage you need at the best cost available.

If your national chain insurance company is the best deal…great. You might find however that you’re overpaying for your coverage.

Don’t trust your hard earned money to a high paid, celebrity actor. Those high-cost advertisements are being financed with your premium dollars!

Read more: How are home insurance rates determined?